Inflation shock prompts Bank of England explanation

The Consumer Price Index hit a 10-year high yesterday, prompting Bank of England governor Mervyn King to write an explanatory letter to chancellor Gordon Brown. Financial Times. The Independent. The Times

The unexpected rise to 3.1% in March, from 2.8% in February, drove sterling up above $2 for the first time in 15 years and sparked fears that interest rates will rise again next month, to 5.75%, and possibly to 6% by the autumn.